Business Plan

Business Plan

Clive & Gillian Ray

Application for funding Application for funding

via via

Venture WalesVenture Wales

1

Contents

Contents

Executive Summary Page 2

Background proposition & personnel Page 4

SWOT Analysis Page 5 The Trevor Arms Heritage Page 6 Welcome to Wales Trevor Arms target market Page 7

Financial Considerations Page 9

2

Executive Summary

Executive Summary

The Trevor Arms Hotel & Restaurant The Trevor Arms is a Grade II listed building comprising a hotel and restaurant, situated on the Welsh border and close to the wealth and culture of Chester. This establishment is losing sight of its heritage and has a fading reputation. Yet, its location provides excellent access to a substantial tourist market and its proximity to Welsh heritage offers a unique opportunity to welcome visitors to Wales. In 2006/7 according to the Welsh Assembly Government (2007), tourism in North Wales accounted for 2.95 million trips in 2007 with 11.43 million bed nights. The spend was £476.27 million. To pitch effectively at this market the Trevor Arms is in need of renovation and the business requires focus. This document details the proposition to address these two factors. Successful implementation of this plan will preserve heritage in Wrexham and will provide a platform to build a successful operation at the heart of Welsh tourism in North Wales.

Background For over a decade my wife and I have dreamed of returning to the Trevor Arms in Marford and transforming this business into a premier landmark for visitors to Wales. The average stay for visitors to North Wales was 3.87 nights in 2007 with an average spend of £42 per night (the Trevor Arms charges £40). Fulfilment of such an ambition requires substantial investment in infrastructure, enhanced presentation, targeted marketing and ultimately outstanding customer service. Whilst we have both enjoyed considerable success in our relative business interests and believe this success can be transferred into the Trevor Arms, the scale of investment in infrastructure required is beyond our resources. Both myself and my wife have customer facing businesses in Wrexham and both have flourished notwithstanding recession. Our focus, determination and a degree of business acumen, present some of the transferable skills to be applied to our “new” business. Moreover, it must be remembered that having managed the Trevor Arms in the past, this business is not entirely “new” to us, indeed, we are well appraised of its potential. We believe the tourist market has yet to be exploited and see enhanced opportunities in marketing to this sector. To achieve this, accommodation must be upgraded as 30% of the bedrooms cannot be used. Poor presentation will fail to attract new custom and will not endear existing users to return. Its location has been undervalued and its reputation receded. Transforming this business will add a focal point to the tourist map of North Wales. It would add value to the local community by providing a high profile restaurant for consumers and some employment prospects for locals. Such prospects will be enhanced through the provision of a desirable hotel to rival local Travel lodges and hotels in Chester. The business would provide an additional centre to direct visitors to local attractions and amenities.

3

Continued...

Executive Summary continued

Financial Requirements Access to current business performance is restricted but knowledge of the business and effective cooperation with the brewery has allowed us to produce realistic projections. Conservative figures for sales of liquor and food, agreed with the brewery, would generate £231,400 gross profit per annum. Accommodation is currently erratic due to the neglected state of the rooms and a lack of marketing focus. Income agreed with the brewery, based on 30% occupancy (10 out of 30 rooms) accounts for a further £145,200 per annum. Gross profit would be £376,600 and net profit £156,380. Expenditure: Whilst the external elevations and internal corridors require attention, it is the restaurant and in particular the bedrooms where investment is required. Current accommodation offers 30 bedrooms but 10 cannot be utilised. Historically, the hotel operates 363 days per year at a current cost of £40 per night. The loss of 10 rooms equates to a minimum loss of 3,630 tourists/customers or £145,200 in accommodation fee income. Furthermore, whilst each customer spends a small amount of money in the bar, traditionally 70% of residents utilise the restaurant. In this case the restaurant is losing 2,541 tourists/customers per annum. The total renovation cost will be in the region of £140,000. The return on investment as a result would: 1. Preserve heritage in Wales 2. Provide additional focus for tourism in Wales 3. Provide accommodation and food creating jobs in the local economy The Trevor Arms is the first listed hotel in Wales for tourists leaving the historic city of Chester and should be firmly placed on the tourists map. Once over the threshold, presentation, accommodation and service must exceed expectations; guests need to feel welcome both to the Trevor Arms and to Wales. Furthermore, just as important, guests must want to return. This plan details the steps we wish to take to upgrade and to market the best hotel & restaurant in North Wales. Every business needs a plan and every business requires a realistic financial appraisal to facilitate success. Gill and myself commend this business plan to you, we thank you in advance for taking the time to read the document and feel sure you will be compelled to support this exciting business opportunity. Clive Ray July 2009

4

Background

Background

History I realised my ambition a few years ago when I was granted the opportunity to manage and later purchase the Trevor Arms Hotel in Marford. Objectively, my time there was a success, perhaps it was too successful as the owner changed his mind and refused to sell the establishment to me due to its increased profitability; he retained the business himself for a further eight years. We decided to start a family and to establish a new mortgage and finance businesses from home. Growth in both family and business required larger office premises and indeed presented the opportunity for us to establish a second related company. Notwithstanding the considerable success enjoyed by both businesses we both retained the desire to return to the ownership and management of a market leading hotel/restaurant. This opportunity has once again presented itself.

Objective To purchase the Trevor Arms and to make the hotel and restaurant an established fixture on the tourist map of North Wales. A robust business plan will ensure: 1. Upgrade of premises & presentation of the hotel 2. Market direct to tourists offering a warm welcome to the Trevor Arms and to Wales 3. Establish a reputation both locally and nationally for hospitality and service

Delivering the objective: Management team The management team is myself and my wife Gillian. We believe that effective delegation can only be implemented once the ground rules have been established. For my part, I am gregarious but do not suffer fools lightly. Staff and the public know exactly where they stand when dealing with me. My current business has seen almost linear growth since inception in 2002. My business is small, focused and profitable. I have 100% staff retention rate and enjoy substantial repeat custom. Gill complements me, she is more studious and is better at attention to detail. Quiet by comparison, she has a warm and easy going personality which both customers and staff find endearing. She is supportive, intelligent and straight, never frightened to express her opinion, indeed when she does, people listen. Gill provides balance, she can delegate effectively and strives for exemplary standards at all times. The mortgage industry requires the ability to sell in a very regulated environment. Gills business has expanded by over 263% in Q1 2009 over Q1 2008. This demonstrates her successful focus on sales and customer service against a backdrop of compliance legislation in the worst mortgage market the UK has ever experienced.

5

SWOT Analysis

Strengths, Weaknesses, Opportunities, Threats

Strengths • Location, the Trevor Arms is the first Welsh listed hotel /restaurant when leaving Chester on

the road to North Wales. Effective marketing can ensure that tourists stay and eat on this side of the boarder.

• Furthermore, the hotel is situated in an affluent area. It is our view that this has not been exploited and provides a massive opportunity.

• The hotel and restaurant has a long and established reputation. • The hotel has been the subject of ghost hunting due to historical records which confirm

Marford as a centre for execution in the past • Situated close to the Wrexham bypass the hotel is well positioned for businessmen working

in Wrexham or Chester.

Weaknesses • The building and interior requires an upgrade. The bedrooms are now poor and are not of

an acceptable standard for tourists or business men/women. The car park must be resurfaced to avoid speculative or actual claims for damage to vehicles. A remote location demands adequate parking.

• The restaurant room needs to be upgraded to compete with affluent neighbours across the border

• Reduced passing trade due to the bypass. • Reputation of Chester for eating and accommodation • Older buildings are often more difficult to change structurally should demand require it.

Opportunities • Launch the hotel and restaurant as a focal point to stay when visiting Wales • Pitch against the established businesses across the border, offering Welsh heritage, a quiet

upmarket location and a warmth of welcome which consumers want to experience • Re-launch the business to the local affluent population, • Exploit the local business community which gravitates to Travel lodges, offer rooms and

facilities to local organisations and businesses looking for professional business facilities including broadband, accommodation and food.

• Review opportunities for quality organisations to meet, present, trade, eat and reside; tourist shows, black tie functions, beer festivals, national trust meetings and antiques road shows

Threats • Following local research and mystery shopping regarding the Trevor Arms, we find the

current reputation regarding food and overall service to be poor. Failure to remedy these fundamental views will see the business embark upon a downward spiral as reduced customers will necessitate cuts in staffing.

• Chester has a deserved reputation for restaurants and culture, not only must we match Chester in terms of marketing to attract visitors but must offer those visitors quality accom-modation and restaurant. Lack of investment will clearly prevent success in this endeavour.

6

The Trevor Arms, Marford

The Trevor Arms, Marford

The Trevor Arms is located at the bottom of Marford hill. Marford is a wealthy area located on the old Chester/Wrexham road. It is a picturesque and peaceful village. Covering some 750 acres, it is located where the hills of North Wales meet the vast plains of Cheshire. From vantage points within Marford one can observe Eaton Hall, Chester Town Hall and Chester Cathedral. Moving round one can see the Cheshire plains, the Peckforton hills and Beeston castle. The name Marford is believed to be derived from a lake or boundary, which describes its position relative to the river Alyn. One feature of many of the houses in Marford are the crosses. Their purpose was to protect the inhabitants from Marford's ghosts. Public executions, both beheading and hanging took place in the village. For many, the Trevor Arms itself has a room which is visited by such a ghost. The Trevor Arms itself, dates from 1811, when it took over the function of toll house from an adjacent cottage and later its ale licence. It soon became a coaching house providing an opportunity for rest, changing and adding horses before tackling Marford hill. During the nineteenth century horse racing took place on the field at the foot of Marford hill. At one meeting held on the 26th of December 1853 'The Trevor Arms Stakes' was run with prize money of £5,10 shillings. To the rear of The Trevor is a former gravel quarry that is now a site of special scientific interest. Many forms of wild life can be seen including Badgers and Wild Orchids. Comparisons with local hotels, such buildings are not listed and have no ghost ! The Trevor Arms standard bedroom £40 per night Rossett Hall Hotel standard bedroom £59 per night Llyndir Hall Hotel standard bedroom £60.75 per night The Grosvenor Hotel Pulford standard bedroom £90 per night

7

The Trevor Arms, welcome you to Wales

Welcome to Wales

The Trevor Arms is in an ideal location for tourism. We wish to exploit this position and target this market. Staff will help visitors regarding where to go and what to see. Staff will facilitate forward bookings.

48% of visitors to North Wales in 2007 made advance bookings, 26% of these used the accommodation provider. In this event, the value of this service (ie. 26% of total tourism spend) amounts to approx £125m. It is clearly desirable to offer additional rooms where there is clearly a market. Where such rooms are utilised over a quarter of users will purchase trips in advance. Ten additional rooms at 59% occu-pancy would offer additional accommodation to over 2,000 tourists per annum worth over £568k per annum to the Welsh economy Top 10 attractions in North Wales Top local attractions add to the those according to www.topten.co.uk named in the famous poem

We offer touch screens to facilitate advice, interaction & to inform.

We will facilitate advanced bookings...

"Pistyll Rhaeder and Wrexham Steeple Snowdon's Mountain without it's people. Overton Yew Trees, St Winefredes Well, Llangollen Bridge and Gresford Bells."

• Adventure Mountain Ewe-Phoria, Corwen

• Denbigh castle

• Erddig & Chirk Castle both National Trust

• Internaltional Eisteddford,

• Llangollen Steam Railway & Thomas The Tank

• Marford Quarry

• Gresford Colliery disaster information

• Gresford Church

8

Welcome you to Wales… events

Welcome to Wales continued

Targeted marketing will be the focal point to fill the rooms: working with North Wales Tourism offing market leading rates in a location well positioned to access both the hills and the coast. Events are staged throughout the year

Portmeirion Antique Road Show Anglesea Beer Festival

Erddig Apple Festival Wrexham Victorian Market

9

Financials

The Trevor Arms remains a viable proposition, though to arrest its decline and to develop the business the building requires some investment. The outside and much of the interior requires a face lift The restaurant will be redesigned and decorated The 30 bedrooms require upgrading* 10 of the bedrooms cannot be used and require substantial investment The estimated costs for this work are as follows: External decoration £ 5,000 Car park £12,000 Internal decoration inc restaurant, flooring & re-plastering 16 new tables & chairs £10,000 20 bedrooms upgraded (£3k per room) £60,000 10 bedrooms gutted and refit (£5k per room) £50,000 Total cost £137,000

Implications The business rationale for growth is threefold, tourism, business & locals The primary focus will be tourism, the business will work with the North Wales tourist board together with an effective web marketing program. The hotel will introduce tech-nology to facilitate tourist information and on-line bookings The second focal point will be the local business community. Local businesses will be invited to utilise the hotel for their visitors and for their meetings. The ICT infrastruc-ture will add value here. The third area is the local community. Given the affluent nature of the area the man-agement wish to offer the facilities, the quality and ambiance demanded by wealthy patrons. In addition to this category we would wish to make contact with local societies to generate use of all facilities; history & genealogy, antiques, wine tasting. From previous experience at this hotel, we secured higher than average room and res-taurant sales. The business lacks a third of its capacity so markets to this. Once we have 100% availability then we should market to secure this; The Welsh Assembly state that hotel occupancy in 2007 ran at 59%, currently this would mean that 11 out of 20 rooms are used. Compare this to 17 rooms out of 30. This additional 6 rooms

Financial Considerations

10

Financials

Financials

Weekly Annual

Wet sales £2,500 £130,000

less

Cost of sales £65,000

Gross profit £65,000

Food sales £5,200 £270,400

less

Cost of sales £2,000 £104,000

Gross profit £3,200 £166,400

Accommodation

30 room capacity

10 rooms @ £40 x 363 days

Gross profit £145,200

Total gross income £376,600

Less administration, wages, taxation, misc costs £156,380

Net income £220,220

Estimated loss of business due to poor condition of bedrooms

Ten rooms which cannot be used

Loss of tourists (10 rooms x 363) 3630

Loss of potential income to the Trevor Arms £145,200

Loss of spend in Wesh economy if other hotels fail to attract

based on average spend per head of £161.45 x 3630 visitors £586,064

Loss of income in the restaurant based on 70%

Number of custom 2541

Loss of income based on £10 per head £25,410